By Gerry Barker
September 29, 2016
This week was eventful to say the least. What follows is a lot of info. Be patient, it will be up on www.guelphspeaks.ca for the next few days.
Pat Fung is a Certified Public accountant and a Chartered Account with wide spread experience in industry and business involving senior positions. His expert analysis of the high cost structure of operating the city and solutions to fixing the runaway costs of living in Guelph, was ignored on two levels.
First, Pat’s presentation to city council last Monday night, in the words of the Guelph Tribune, was: “Persistent city finance critic rebuffed at Guelph council meeting.”
During his five-minute presentation, Mr. Fung asked Mr. Amorosi to respond to the CAO’s new plan. It is to cover the next 18 to 24 months setting three performance goals: Service excellence, financial stability and innovation at city hall.
The Mayor interceded closing down the reply: “I find it a bit disturbing that people would come in here and challenge our staff in this way.”
Is the Mayor tone deaf? Is he now so supportive of the paid staff that no citizen can question their performance? Maybe he can explain just who he represents, the people who elected him to protect their interests, or the paid staff charged with managing the $500 million corporation.
The CAO did not explain what he meant by financial stability or those past financial disasters such at the Urbacon lawsuit involving the new city hall, costing $23 million over contract; the cost of the Community Energy Initiative that has reached $37.1 million and counting; the depletion of the reserve funds that the BMA consultants warned the administration by raising a “red flag.”
Commenting on the CAO goals, Mayor Cam Guthrie gushed: “I have never seen a more well functioning executive team ever… and this plan is amazing.” The news story in the Tribune did not carry details of the CAO’s new administrative plan and targets.
In his two-year record as Mayor, his ardent support of senior managers, our Mayor went out of his way to support former CAO Ann Pappert. He had to be the only person in the city who realized she was not up for the job. She resigned in May, as did current CAO Derrick Thomson who also decided to take a job with the Town of Caledon. Within a very short period of time, Mr. Thomson was hired to replace Ms. Pappert as CAO. Did our Mayor believe this was happenstance or crumbling of senior managemement under his watch?
For the record, Mr. Thomson was hired in 2013 as Executive Director of Operations, with a starting salary of $173,720, according to the 2014 Sunshine List. His responsibilities included managing the largest public service department in the administration.
In the 2015 Sunshine List, Mr. Thomson’s salary rose to $207,534. That’s an increase of $33,814 or 19.4 per cent. This occurred during a closed-door session of council December 10, 2015. His new salary as CAO has not been disclosed. Council approved 2015 salary increases of the four top senior managers: Ann Pappert, $37,591, 17.11 per cent; Mark Amorosi, $26,868,14.7 per cent; Al Horsman (no longer employed with the city); Derrick Thomson, $33,824, 19.48 per cent. Ms Colleen Clack was promoted from General Manager of Culture and Tourism to DCAO of Operations replacing Mr. Thomson. Her 2015 salary was $142,017. Appointed in June to her new post, her new salary will not be known until March 2017.
Do these senior staff increases reflect the Guelph economy?
Am I not the only taxpayer in this city that questions these increases and how they were established and by whom? Also as the decision was held in a private session, the public should know who attended that meeting and how they voted. I will request the city clerk to provide the minutes of this closed meeting and the vote result.
If this isn’t a deliberate attempt to conceal important information to which the public is entitled, then thousands of residents are being duped, Fortunately, the public will be told when the 2016 Sunshine List is published next March. If it weren’t for this list, citizens would never know the outcome of vital, financial statements that represent the public’s interest and to which they are entitled. It’s their money as shareholders of the city corporation.
The failure of Mayor Guthrie to not insist on public disclosure of these mega increases, identifies him as being a partner to this subterfuge that is tearing down what’s left of the public trust in its civic institutions.
But, this week a group of citizens raised money to purchase advertising space in the Guelph Mercury Tribune newspaper. I was informed that the paper would not publish the ad until I made changes to the copy that highlighted the financial analysis prepared by Pat Fung from two sources: The city’s own audited Financial Information Reports were submitted to the province and a city hired management consultant firm, BMA were used to document Mr. Fung’s analysis;
When told about the demands of the newspaper, I asked for written reasons for their objections of the copy. They refused to do that but the ad rep would tell me in general terms of the changes they required.
At that point, I realized that this objection was now in the hands of corporate lawyers.
At any rate, here is what they said: Nothing in the ad copy was documented. Well, that isn’t true as you may read for yourselves in a reproduction of the ad below. The sources of the information are clearly stated and have never been denied or challenged by any administration official, including the Mayor and council majority.
The paper said the ad contained inflammatory language. Again, is it not the right of citizens to present facts and protest government representatives and their conduct of the public business? This is something right out of the history books when the Soviets controlled the populace and their message.
Welcome to the Guelph Gulag.
Ignoring the fact that the civic action group, GrassRoots Guelph, purchased more than $6,000 in advertising in the Tribune during the 2014 election campaign, the present management demanded details of the organization, its non profit corporation ID, address (which was in the ad). These demands were obviously prepared by a lawyer, but who? Was it Metroland Publishing , owners of the Tribune, or the City of Guelph legal services involved? They wanted contact information when both Pat and I not only had our names in the ad but how to reach us through either http://www.guelphspeaks.ca or Pat Fung’s email address.
This is nothing but an attempt to suppress documented and legitimate protest of citizens illustrating excesses by the past and current administration. Under the Canadian Charter of Rights and Freedoms, there is still free speech in this country. Citizens have the right to protest, complain and challenge a public funded administration that is patently out of touch, and worse, uncaring.
So why is the newspaper blocking this important information? It’s probably to protect its lucrative advertising contract with the City of Guelph. “City News” pages appear in every edition of the newspaper. The citizens are paying for this service through their tax bills. The annual cost is estimated to range from $350, 000 to $500,000. Currently, it is impossible to find out. The Tribune owners abjectly support the administration through the news content and commentary.
Pat Fung sent a copy of his analysis to every member of council August 18. He asked the Tribune editor to publish the analysis as an op-ed piece and was refused on the ground it was too long and too political.
Pat and I then decided to collect funds to publish all or a condensation in a full page ad in the paper. We used the GrassRoots Guelph system to collect funds as it was the only established civic activist organization that has the structure to accept direction. GRG is not actively engaged at this point to represent all those folks who are seeking justice and a vehicle to vent their frustrations.
http://www.guelphspeaks.ca never sleeps
Fortunately http://www.guelphspeaks.ca offers a window to comment and self expression. Further, GS never sleeps it’s content is available 24/7 to anyone who links to the blog.
Now you know the rest of the story. This is nothing but suppression of an accurate analysis of the state of city finances. Pat was willing to work with the Tribune but you cannot edit a 2,808 word document into 400 words as demanded by the editor.
The final question is why didn’t the Tribune editorial staff interview Pat when they had ample time to verify the accuracy of his analysis? Why have they not reported on the concerns of citizens?
The Guelph Tribune is not a newspaper but a print lap dog to the city administration that is paying a lot of Tribune bills and masquerading as a newspaper.
But judge for yourselves. Here is the ad the Tribune refused to publish.
Heading – A city in crisis
By Gerry Barker, editor of http://www.guelphspeaks.ca with Pat Fung, CPA, CA
September 29, 2016
A stirring wake-up call by Guelph resident, Pat Fung, CPA, CA, analyzes the financial state of the Guelph’s administrative mismanagement of our city that is exacerbated by a bloated bureaucracy and dysfunctional council.
It has now reached a crisis of misspent treasure and lack of confidence by the public in past and present administrations. It is expressed in annual property taxes, and user fee increases. The crisis includes secret deals made with certain developers to induce special treatment by reduction of development fees and taxes. City reserves have been plundered without public knowledge to cover up mistakes.
Reality and responsibility is non-existent as the staff management continues to claim the city is in “sound financial condition,” according to Deputy Chief Administrative Officer (DCAO) Mark Amorosi.
Since 2008, Mark Amorosi is one of senior staff overseeing the soaring cost of living in Guelph. He was hired in 2008 as head of Human Resources. Since then, he has grown in influence becoming a DCAO of Corporate Services, the man in charge of not only HR but also the controller of city finances since the senior staff reorganization following the 2014 civic election.
What Amorosi’s “sound financial condition” claims is compared below to the analysis done by Mr. Fung, an individual with an accredited financial background. The sources of his analysis are contained in the annual audited statements of the City of Guelph and the recent report of management consultants BMA.
Here is a chart, part of Pat Fung’s analysis
Guelph’s Operating Costs 2008 to 2015 (source: City of Guelph’s
audited financial statements)
|($ thousands)||2015||2014||2008||$ Change 08 to 15|| %
’08 to ‘15
|Social and family services||43,601||52,280||51,183||-7,582||-14.8%|
|Recreation and cultural services||40,906||39,481||23,947||16,959||+70.8%|
|Planning and development||7,313||6,155||3,986||3,327||+83.5%|
|Consumer Price Index||126.6||125.2||114.1||12.5||+11.0%|
Pat: Guelph should reduce its operating expenses by $20 million and freeze taxes and fees at current levels to fund the capital/infrastructure gap. We cannot continue to increase spending on operating costs on top of increasing spending of capital and infrastructure
Pat’s recommendation: Freezing revenues at 2016 levels and reducing expenses by $20 million, and holding expenses at $365 million for 20 years. City reserves would be built up to $200 million in 10 years. This would be reduced by whatever is spent in the interim on capital and infrastructure. This has the same financial effect as increasing taxes but is funded totally from within the current system of taxation and user fees.
Where did the money go? For example, note two categories: Social and Family services, a 14.8 per cent reduction and Social Housing, of which there was zero change in seven years. These are two key components of the leftist majority agenda on the present council. Yet during those eight years under the Farbridge regime, the categories were totally ignored.
But wait; let’s check out Environmental Services that enjoyed a 117.6 per cent increase. In fact more money was spent on the environment than Social and Family Services and Social Housing combined. Ask Coun. James Gordon about that as he says it’s his job to improve social services including affordable housing.
Here is another chart that captures the per person charges of Guelph’s selected expenditure categories compared to the Ontario Municipal Averages. These per person figures are from the City’s own consultant, BMA.
|Selected areas from 2014 BMA report||Guelph cost per person||Ontario cost per person||Excess spending relative to other Ontario Cities based on 120,000 population in Guelph|
|Waste collection||$29||$10||$ 2,280,000|
According to the independent BMA consultant report, every person in the city pays $836 for the operational costs of these six defined areas. The average in Ontario is $586 per person. That’s a 42.66 per cent difference, or total excess spending by Guelph of $30 million per year.
Check this out:
|Waste collection $/tonne||$137||$114||20%|
* Why are waste collection costs 20% higher than average Ontario?
* Why are road costs 133% higher than average Ontario?
* Except for residential water/sewer usage, why are commercial and industrial water/sewer costs 10% to 12% higher than average Ontario? Particularly when water consumption has declined by 16 per cent in the past six years.
* Why have Guelph Hydro rates increased by 42.5 per cent in the past four years?
According to the 2015 Sunshine List, the City has 92 middle managers carrying the title “manager,” in addition to senior and supervisory staff. The City must reduce these positions and flatten out the organization to make it more responsive and more cost effective. In our financial situation, we cannot afford this huge layer of middle management.
These soaring costs are one of the problems why Guelph has not achieved greater business and industrial development that increases revenue. The current assessment ratio between residential and commercial/industrial is a dismal 84 per cent to 16 per cent. It has not changed in ten years. The Ontario average ratio in many cities is 60/40. Neighbouring Milton is an example.
Now let’s take the General Government’s cost comparison. Guelph spends $229 per person in this category. The Ontario average cost per person is $104. The difference is a whopping 120 per cent additional cost to every resident of the city.
Further, General Government expense is not a service but overhead. Based on a per capita population, it can be reduced to meet needed operational expenses. This would bring the city government costs in line with what most Ontario municipalities are currently paying. Also, it’s an excellent place to start cutting operational costs.
This method does not affect service cuts to the public, the favourite excuse of the majority of council and the new Chief Administrative Officer, Derrick Thomson. He says the staff will not propose any service cuts in the 2017 budget.
The current acting CFO, DCAO, Mark Amoroso, doesn’t like to talk about the per capita cost to Guelph’s citizens. He says it’s irrelevant. Does he care? He lives in Hamilton.
Looking back nine years, how have your household costs affected you? Did the exploding cost of running a city overtake your income, an ability to pay your City taxes? You are not alone.
Only we the people can create change
This message was paid for by a group of Guelph citizens who care about their city. Now it’s your turn. The best way the people can influence change in the way your money is being managed, is to contact your councillor. Each member has received the Fung analysis. Demand answers from them over the excessive spending and mismanagement contained in this well-documented report. Pat Fung has provided indisputable evidence that this city is on the brink of financial disaster, compounded in the past nine years.
To help stop this recklessness, join the thousands of Guelph residents engaged in protest of the way their city is being mismanaged. Please donate to help finance the protest. Send your donation and comments to:
Box 250 – 17A – 218 Silvercreek Pkwy, North,
Guelph ON N1H 8E8
Please make your cheques and money orders payable to Grassroots Guelph. Sorry, we cannot accept credit card contributions, but cash in a sealed envelope is welcome. No contribution is considered too small. All funds received will be used exclusively for creating change in the way our city is being managed.
Both GrassRoots Guelph and http://www.guelphspeaks.ca are non-profit organizations and manned by volunteers. Thanks for participating, welcome to the cause and join the protest today supporting common sense management.